by Linda Woods

In the new age of dot-com belt tightening, one option that is definitely on the rise is outsourcing. Whether it's high tech code
junkies or e-commerce gurus, it seems every company has a few consultants lurking about these days.

So what about the affiliate marketing industry? Is there a need for outside help in establishing successful affiliate programs for the multitudes of online retailers? Has this relatively new industry even produced any "wiz kids" yet who are able to share their experience in a meaningful way to company's seeking good program management?

It seems the answer is definitely "yes" and here's why. The last few years have been good for the affiliate marketing niche. In less than 5 years, it went from the legendary Jeff Bezos cocktail napkin idea to a ubiquitous button on just about every retailer's site. It still requires plenty of long-winded explanations when you're trying to tell someone at a party what it is you do, but at least in the comfy quarters of your Internet life, everyone knows what affiliate marketing is.

However, the problem is, not everyone knows HOW to do it, and even fewer know how to do it right. As many companies have seen, it isn't good enough to simply throw up an affiliate program and watch your sales soar. It takes constant and innovative management to keep up with and motivate the changing moods and fortunes of hundreds of thousands of potentially successful webmasters. How does one tap into these masses so that they will recognize that your products or services are exactly what their site visitors will want? How do you find them? How do you communicate with them so that you aren't "spamming" your own sales force? How do you decide what motivates or what repels them? How do you decide the eternal question of just whose customer is it? Is it better to start your own program or use a 3rd party solution provider? And the biggest question of all... does anyone make any money running affiliate programs?

These questions and more need to be evaluated very seriously for any program to work well. I've seen lots of companies pulling the plugs on their programs in order to take a couple of steps back, hire someone who knows what they are doing in this niche and then revamp and relaunch the whole program. This is happening more and more, and with good reason. Because the answer to that last question is "YES", there is money to be made with affiliate programs and there are people who know what needs to be done. But like any other department in a company, there must be a good plan, a well thought out strategy and experience in an area that didn't exist 5 years ago.

That's where outsourcing can be a lifesaver to an e-tailer Most online retailers are in 1 of 3 places right now. They either 1) don't have an affiliate marketing program and need one, 2) have an existing program but it isn't performing as well as they'd like, or 3) they have an active, vibrant program and are thrilled with the progress. I'm going to focus on what a "paid gun" consultant could do for situations one and two.

Starting a Program

The time is now. For every month spent evaluating options, making comparative matrixes and deciding on who to hire, a significant sales channel is being totally neglected. According to a quote that everyone likes to tout, some sites are making 40% of their revenue from affiliate sales. So, we'd all like to know who that is, but even if a realistic figure is 10-15% of total sales, who wouldn't like to have 15% more sales right now?

A consultant can help get a company up and running quickly by knowing exactly where to announce the new program, how to promote it, what to offer to get new affiliates excited and how to generate buzz around the launch. The last thing a company needs is a staff person whose new job is to evaluate all the options, make a recommendation and then wait for implementation and pray for success so they can keep their jobs. Get someone who knows how it's done and get it started
immediately. Save running it for an on staff manager who is smart and can be trained to keep it going.

Jump-starting an Existing Program

Lots of sites have them. Ho-hum affiliate programs with thousands of non-performing, even primarily defunct Web site affiliates. Little 2-way communication, low overall commissions, disappointed maybe even hostile affiliates and worst of all, very low sales.

Close it down and rethink the whole program with someone who really understands the trends, what has worked and what hasn't, how the company's goals may or may not differ from their sought after affiliates and why the site was performing poorly. Come up with a strong set of new guidelines for what the affiliate program must accomplish before re-launching. Is it more traffic? Offer to pay for clicks. Is it loyal return customers? Build community and offer residual or 2-tier commissions. Is it branding? Give away something valuable. There are lots of ways to identify the overall reason for a program to exist and then match the payouts, contract and relationships with those goals.

Carrying the Vision

Once the new strategy has been implemented and the new program launched, again an onsite manager can be found to maintain and grow the program. And here's the last problem that can be solved by the outsourced consultant. Who to hire to do this day-to-day management? There's no shortage of smart, talented people in the Internet world these days, the problem is a lack of experienced affiliate program managers. Most started doing it as an offshoot of a part of their "real" job in the marketing or Web design department. But in terms of a large labor pool with "Affiliate Program Manager" listed on their resumes as the title of their last position that's not too prevalent.

So, it's going to take training. Take a smart, motivated employee from the sales or marketing department and teach them about how to run an effective program and where to go to continue to learn and grow from those "in the trenches". A company could utilize the consultant's expertise to train the new manager, map out the strategy, and then arm them with tons of resources of where to find help, and what problems to look for when things get a little shaky. Much of this is so new that the entire body of knowledge is relatively small, so sharing wisdom on this topic is not likely to take very long. But, without someone on the job knowing the wisdom that is out there, the learning curve can be long and painful for the company counting on affiliate sales being 40%.

A few of us affiliate marketing consultants have actually been out there long enough to remember when there wasn't a Commission Junction or a VStore, when no one had thought of 2-tiered commission structure, when contextual selling was unheard of and when the technology of tracking just didn't exist outside of Amazon.

The main thing is, affiliate marketing works. And companies that aren't fully utilizing the vast potential of this sales channel are missing the boat. Affiliates can provide the sales shelves, the sales people, the branding and the traffic that no site can afford to ignore. So the only logical step is to do it and do it well. Hire a professional.